Pittsburgh-based United States Steel Corp. has reported third quarter of 2019 net loss of about $84 million. The company had reported third quarter of 2018 net earnings of about $291 million. Adjusted net loss in the third quarter of 2019 was about $35 million, while adjusted net earnings for the third quarter of 2018 were $321 million.
“The team delivered better-than-expected results from solid cost performance and higher than forecasted shipments in flat-rolled,” says U. S. Steel President and CEO David B. Burritt. “While market headwinds persist, we continue to focus on what we can control, including rescoping our asset revitalization investments and reducing fixed costs. We also completed three financing activities since the quarter ended, which delivered approximately $1.1 billion of incremental capital to further support our strategy.”
According to the company’s third-quarter earnings report, U. S. Steel’s flat-rolled facilities operated well despite difficult market conditions. Burritt says the company’s U. S. Steel Europe operations face tough market pressures, though, and margins for that division remain under pressure. Additionally, the company’s Tubular division has low rig counts and markets for that segment have worsened.
The company reports that its investment in Big River Steel is its No. 1 priority. The two companies recently completed the acquisition. Burritt says the company has a goal of ultimately acquiring 100 percent of Big River Steel. He adds that the company is also making sure it is flexible with its portfolio of strategic investment spending.
Burritt says current market conditions are challenging “based on what transpired in the flat-roll market over the past two months,” but he says he thinks “signs of life are emerging.”
“The end of the [United Auto Workers] strike at GM removes a significant steel demand gap that existed in the market,” he says. “Lead times have extended. And our flat-rolled order rates have materially improved. And scrap prices are expected to increase approximately $20 a ton providing support for steel selling prices. All of these factors provide us confidence that the market is poised to turn from here.”